EPISODE 57~ Think Twice Before You Buy That Fancy Car
When you’re trying to choose which type of new or used car to buy, you should check to see how much it costs to insure different makes and models. This is especially true for young drivers. I just checked and if a 17-year-old guy bought a brand new convertible sports car, it could cost more than $1,300 a month to insure because it’s new, it’s valuable and insurance companies think these cars attract more reckless drivers. But if that same 17-year old guy were to buy a used Honda Civic, his bill could be just $650 a month, because it’s a less valuable, more boring vehicle. In other words, just by choosing one vehicle over another, you could save nearly $8,000 a year. So, definitely check before you buy!
EPISODE 57 ~ MAKE MORE: Make FIVE figures reselling goods online!
We’ve talked before on the Easy Money about how it’s possible to make money by buying used goods cheap and then reselling them online. But you probably never imagined you could make 5 figures doing that? It’s true and it’s our featured “make more” segment of this podcast.
My guest is Glen Zubia, a master reseller and host of Hustler Hacks on You Tube. Welcome to Easy Money, Glen!
Glen, explain the financial position you were in when you got out of college and how that prompted you to look around for creative ways to make money.
I was at about $23,000 in school loans with my car and credit cards. For credit cards I had paid for books. All that together ended up being a little over $50,000. I graduated in Dec 2009. I got a full time job and I started off at the bottom and I figured off quickly I didn’t know how to pay off the loans and make a living and eventually get a house. I didn’t see it happening with how much I was making.
I know you were scraping to make just the minimum payments on your loans. How did you get the idea to buy stuff at garage sales and discount stores and then sell it online?
I contacted one of my friends and said have you been going to garage sales because I would see them Sat morning. So I said let’s get up at 5AM and start going and see what happens. I started off with things I somewhat knew like sneakers and video games and that is what I recommend. Start with what you know. We hit up as many garage sales as we possibly could. Getting up at 5AM. We would map them out and look on Craigslist.
This business wasn’t always easy or intuitive. Talk about some of the hard times early on.
Time management was hard in the beginning. You are so drained from work 8 to 5 at a full time job I thought how will I do this. I stayed up late listing things. But that was what I had to do to put in the work. I made minor mistakes in the beginning. I didn’t know shipping details. Things I thought wouldn’t cost much ended up being more. I spent low in the beginning though with low risk high reward.
There was sort of a turning point when you knew the business would work. Talk about your “Disney moment.”
Over time we stayed consistent with it and then sometimes you get a really special find. For me it was some Disney statues that used to be in Disney stores. The Dumbo one sold for $1800. Mickey Mouse for $1200. Those big heavy finds happen every now and then but most of the time it is consistent.
One key is when you know something has value but the seller doesn’t realize, right? You really scored with some hats because of that.
Garage sale wise a few years ago a lady was selling a bunch of sports team Snap Back Hats. They were a vintage throwback thing that came back as a fashion fad. They were re-selling for $40 to $50 each. Lady sold for $1 each. I bought 5 to test out and they sold very quickly for $40 each. So we went back to her house to ask if she had any more. She had had a store that didn’t work out so she had boxes and boxes full of these hats. We bought all of them from her. I think we ended up spending $250 a box for 4 boxes. Over time we sold every hat. On Craigslist, Ebay etc. We ended up making $10,000 from just those hats.
Some of these products you yourself knew were valuable, but you also do your homework, right?
Having a Smart phone, you can look at things while you are shopping. I use the Amazon Seller app to scan items and compare prices while in the store. You can scan bar codes to see the current rate on Amazon so I started using that. “We spent time on Ebay to see what was selling. We noticed Coach purses were selling well so we would sell those. Same with vintage video games or brand new box toys. A lot of it came from researching on Ebay.
And eventually you graduated from just hitting garage sales to other sources, right?
I look for deals wherever I can find them, including at thrift stores, pawnshops and garage sales. But these days I also shop a lot at Ross, Marshalls, Burlington, Tuesday Morning and T.J. Maxx. Of those three stores, I visit Ross most frequently. I go three to four times a week — hitting several locations — because you never know when new merchandise will arrive.
Jeez, this sounds like a full time job! Is it your main gig these days, or do you have a quote unquote “real” job?
I still consider this a side hustle, but I knew it was time to quit my full time job as a graphic designer when this side hustle made more money than that other job. Now I help my family business which gives me flexible hours, so that I can spend about 20 to 30 hours a week on this side job.
Well, now that we’re talking money, tell us how much you made as a reseller in the first couple of years and what happened to that debt of yours?
When I really started getting serious about re-selling, it took me 2 to 3 years to pay off the $50,000 in debt. After eliminating student loans, my car payment and my credit card debt in less than five years, I got married and bought a house. Now my new goal is to pay my house in less than 10 years. That keeps me going. Right now I am doing well with that. Without re-selling I don’t think I would have paid the debt and been able to put down such a good down payment and have money to reinvest and for savings. I never thought I would get to that point.
Wow! So how much are you able to make per month as a reseller?
When I first started I was just trying to make an extra $1500 a month because I was working full time at the university. At this point now after several years doing it across several platforms I am consistently at $7,000-$8,000 a month.trying to get $12,000 to $15,000 a month profit.
Well, now you’ve got people’s attention. Let’s give listeners some advice if they want to try this themselves. I’ll state your tip and you explain it. You suggest people start by selling their own stuff. Why?
If just starting out, instead of spending money, get rid of things in your own house. When you don’t have much, it’s a good place to start. Start slow and go with low cost.
Second, you say, buy things you know.
I suggest that beginners focus on what they know. While I buy many things, I have always been interested in sneakers, so my knowledge about shoes helps me determine whether to pick up something or pass on it. For example, once I bought a pair of Air Jordan shoes for $49.99 at Ross and sold them for $350 on eBay.
EPISODE 57 ~ An Efficient Way to Reduce Interest Charges AND Lower Credit Card Debt
It also makes sense because many of us are paid bi-weekly, so this evens out your cash flow. More importantly, it results in making more payments per year, since there are more than four weeks in most months. That’s because there are two months of the year that you end up making three payments instead of two.
I’m going to use a real whopper of a debt for this example, to show what a difference this strategy can make. Let’s say you owe $20,000 at 24.99% interest. A typical minimum payment would be $800 a month. So instead you send $400 every two weeks. Here’s the math.
If you pay on this debt monthly, you’ll end up paying $8,539 in interest. But if you pay this card down every 2 weeks, you will end up paying just $7,539 in interest. You save a thousand bucks AND get that debt paid off early. Paying bi-weekly may sound like pain, but in this day of online banking it’s a cinch. Just make sure you pay more than the minimum balance with your biweekly payments.
I first saw this idea on CreditCards.com and I will link you to their article on what they call “micropayments” from EasyMoneyShow.com/57.
Learn more about saving on interest charges: www.creditcards.com/credit-card-news/help/micropayments-cut-down-credit-card-debt-6000.php
EPISODE 57~ You Could Have Unclaimed Money Due to Property Taxes and Not Even Know It
OK, back to overpaid property taxes. Super common as a form of unclaimed money. Think about it: Oftentimes your mortgage company collects extra money from you and uses it to pay your property taxes. The jargon is that they “escrow” this money or “hold it in escrow” to pay your taxes.
But, I know my husband and I used to receive a statement from the city government informing us of the amount of our property tax bill, even if we didn’t pay it directly. In tiny print there was a notification that our mortgage lender had “requested the bill.” Which is government speak for requested and paid. But the notice looks like a bill and it’s easy to miss or misconstrue those words about requesting the bill. SO, some people end up paying their property tax themselves, even though their mortgage company has already collected money from them and paid it. Voila! Double payment.
In addition, many lenders, once you have at least 20 percent equity in your home, will allow you to pay your own property taxes directly. Some people like to do this so they can keep that money invested until it’s time to pay. But switching over from having the mortgage company pay the property taxes to doing it yourself also creates another opportunity for there to be missing money hanging out there. The chances are high that the mortgage company already collected some escrow money before you switched over to self-payment. In this case, the mortgage company would be the one to turn the unclaimed funds over to your state.
So there you have it, one potential source of unclaimed funds that can happen even if you think you’d never lose track of your money.
EPISODE 57 ~ GUEST BLOG: Glen Zubia Knows How to Get You Out of Debt
Glen’s top ten tips for making money online: www.youtube.com/watch?v=VMLC1k2qOVY
GUEST BIO:
Glen Zubia, Jr is an e-Commerce Merchant from El Paso, Texas. Glen is best known for his YouTube Channel, Hustler Hacks, which has generated over 40,000 subscribers and 4.6 million views. After graduating from college in 2009, Glen went to work as a full-time graphic designer, but struggled to make minimum payments on his debts. With over $50,000 of combined Student Loan, Car Loan and Credit Card debt, he knew it was time for a big change. Glen began buying items at thrift stores and garage sales to resell on sites like eBay and Amazon.
In about a year, income from his “side hustle” had surpassed his salary. His story has been published in popular websites such as U.S. News & World Report, Clark.com and dontwasteyourmoney.com.
Glen hopes to inspire others who are struggling with money (especially after college) to take advantage of the many money-making opportunities that are available through e-Commerce.
GUEST CONTACT:
Website: www.hustlerhacks.com/
YouTube: Hustler Hacks
Instagram: @hustlerhacks
EPISODE 56~ EASY MONEY PODCAST
EPISODE 56~ Be Careful What You Pack in Your Luggage, Airlines May Not Cover Them!
Never pack expensive electronics in your checked suitcase because the airlines won’t cover them if they’re lost or damaged. Every airline I know of excludes these from their reimbursements. If you’re carry-on is feeling really heavy, you might be tempted to stuff your laptop or iPad or camera or whatever in the luggage you’re checking so you don’t have to carry it, but resist the temptation. What about travel insurance? Many policies exclude laptops and most limit the reimbursement for lost or damaged luggage to about $200 bucks, which doesn’t cover much. Word to the wise: Keep your fancy electronics in your carry on or leave them at home.
EPISODE 56 ~ MAKE MORE: How Job Hopping Can Increase Your Income
Did you know that you can make more money just by switching jobs? Many thanks to Business Insider where I first saw this research. The conventional wisdom has always been that it’s a bad idea to move from one firm to another too often because it makes you look flaky. BUT a study showed that people who stay put for too long end up making less money than people who switch fairly frequently.
The researchers delved into the data and found that job switchers make about 1 percent more per year than those who stay the course. That does not sound like an impressive statistic, but picture it spread out over years and years. Thanks to higher re-set points every time you change employers, that 1% a year could add up to hundreds of thousands more by the end of your career. It’s particularly helpful to snag big salary hikes in your 20s and 30s because statistics show our incomes level off in our 40s, so you want that money to level off at a high level.
Bottom line: people who job hop a bit have more bargaining power when negotiating with a new employer than people asking for raises at their current job. Oh, and a positive trend the researchers noted: employees are going for it, quitting their jobs and taking new ones at pre-recession levels now. Woohoo! Sounds like freedom and flexibility to me!
Wage growth chart for job hopping: www.businessinsider.com/earn-more-money-switching-jobs-2017-7
EPISODE 56 ~ Improving Your Credit Score Can Save You More You Think
When most people talk about ways to save money, they use phrases like “tightening your belt” and suggest strategies like skipping your daily latte or brown bagging your lunch. That’s all fine, but most people don’t talk about the biggest money-saver of all: improving your credit score. That is our featured save more segment of this podcast. Raising your score lowers the interest rate you are charged for loans, which can easily save you 5 or 6 figures in interest on credit cards, car loans, and mortgages.
My guest is Carolyn Warren, author of the new book “Repair Your Credit Like the Pros” and a working mortgage broker who deals with people and their credit all the time. Welcome to Easy Money, Carolyn.
Carolyn, why are credit scores so important and what’s the number people need to hit in order to get the best possible interest rates on loans?
These days, virtually any loan you take out will be based on your credit score. Lenders give the best rates to people with credit scores of 740 and above.
It’s not just loans, though is it? Now other businesses, like insurance companies, are using credit scores to decide how much to charge us for car insurance. You recently blogged about how much an insurance company would charge somebody with a low credit score versus somebody with a DUI. What was the difference?
Low Credit Score: $1,521 insurance premium
High Credit Score but with a DWI: $1,097 insurance premium
The person with a low credit score pays $424 more than the person with the DWI! I don’t know about you, but I’d rather be a passenger in a car with a driver who had a low score than with an intoxicated driver.